Balo’s Spectacular Targets for 2014

Last week, Bulent Kosmaz (CEO of Balo) stated that the frequency is now 3 trains/week starting with 2014, and will be increased to 5 trains/week by March 2014. In this way, annual capacity will be 14688 in 2014, and they’re planning to load 85% of them which makes 12485 container, so stated Mr Kosmaz.

Although Balo has showed great initiative for its trains until now, 5 trains per week with 85% occupation rate before the first anniversary of an operator must still be counted as spectacular considering all past experiences in Turkey. Unfortunately, container trains never had been so promising before.

But can these targets be realized?

If Balo had shared the volumes and occupancy rates of past months, we might have some estimations based on that data. Since we don’t have any, let’s do some “brain storming”.

All other container lines departing from Cerkezkoy and Tekirdag have hardly get loads from regions not close to Istanbul. Starting with Aegean Region, Balo had moved in “blue ocean” in 2013. Communication advantages of being a subsidiary of chambers, giving guarantee of service sustainability even in case of loss and being alone in Aegean Region of Turkey probably provided Balo higher occupancy rates. Connecting some other regions and transferring some clients in Istanbul, Balo will be able to fill 5 weekly westbound trains easily.

So why not assuming west-bounds as a piece of cake and accepting the occupation rate of 100%? Well, then there is still 70% of 5 eastbound trains to be filled.

The “hardest” issue is that most of the imports of Turkey is paid by consignors. So filling eastbound trains needs marketing in Europe for the new customers.

Maybe “spectacular” performance is the best marketing, and a lot of existing customers will start to be persuaded by themselves, why not?

Currently, there are 3 container lines running regularly between Turkey and Europe. IFB, Express Interfracht and Metrans. These 3 are making 10 trains in each direction every week. To be able to fill 70% of 5 trains is almost equal to one third of all these 3 operators. So this shift, if happens, will surely give a vital loss at least to some of them. Everybody knows, you cannot survive in long term if you decrease the frequency.

Or..? Traditionally, all operators are stronger in eastbound trains, and have lower occupancy rates in west-bounds. Thus a collaboration, mergery of trains of an operator with Balo, is something we must not fully neglect.

It seems that, 2014 will be a “settle down” year for all players in railway.